Latest estimates place the energy trade gap at around 3 percent by 2025.

Although there are some reasonable questions about the value of making long-term projections about energy use, doing so is one of the duties of the US' Energy Information Agency. On Monday, the EIA released an overview of a report in which it attempts to track the trends in the energy economy of the US out to 2040. The report contains some eye-popping predictions, including a huge (but brief) boom in domestic oil production, a near balance between energy imports and exports, and a peak in carbon emissions that's already in our past.

Energy predictions are fraught with uncertainty, but this report contains more than most, since it's predicated on having the entire period out to 2040 covered by legislation and rules that are already on the books. At the moment, that would include the expiration of a tax credit that promotes the installation of renewable power facilities, something that Congress has already renewed several times. Perhaps more significantly, the EPA's rules governing greenhouse gas emissions from existing facilities are still being formulated but are likely to be in effect for most of the period under consideration.

This probably explains why the EIA predicts that the slice of domestic energy production that comes from renewables only increases from 11 to 12 percent over the next 30 years.

But what's startling is that, despite the slow rise in renewables, the EIA thinks that the US is already past its peak of carbon emissions (2005 and 2007 both had roughly similar totals and represent the peak). As shown in the chart below, the energy used for each dollar of GDP has been dropping steadily since the 1980s; carbon emissions for each dollar have recently started dropping even faster. The report projects that those trends will both continue, with energy/dollar dropping by a total of 43 percent by 2040.

In addition to the growth of natural gas and rise of renewables, the report ascribes this drop to an increase in efficiency (vehicle fuel efficiency in particular is improving significantly). This won't result in a big drop in carbon emissions—continued GDP growth will offset these tends—but it could mean a prolonged plateau out to 2040. And, as noted above, policy changes may actually help drive a drop, and any climate agreements are likely to require one.

The other thing driving the drop in carbon intensity is the natural gas boom. It's made natural gas the cheapest way to generate electricity in the US (ahead of well-sited wind), a change that the report predicts will see gas become the largest source of electrical power in the US by 2030, displacing coal. Given that burning coal releases far more CO2 per unit of energy, any emissions rules could accelerate this changeover as well.

There's a technique similar to fracking that works for oil, and that's setting off an equivalent boom. The EIA expects that oil production within the US will reach levels not seen since the peak in 1970. But oil flows through rocks less easily than natural gas, so the boom will be short lived, peaking before this decade is over. In contrast, the growth of natural gas extraction won't peak at all in the report's timeframe, leading to 50 percent growth between now and 2040.

The net result is that the gap between net energy production and consumption, currently at 16 percent, will drop to under five percent in the 2020s and stay there. We'll still import lots of oil, but exports of coal and natural gas will offset most of that.

The surge in natural gas supply will have impacts beyond turning the US into a net exporter of the fuel. It can be used as a raw material in many chemical processes, and the cheap power it generates can make various industrial activities more economical. As a result, the EIA foresees a growth in domestic chemical and metal production, as well as other forms of manufacturing. This won't be large for any one sector, but the overall growth will be fairly significant.

The other place that's likely to see growth is the use of natural gas in transportation. The EIA thinks that the price of natural gas will go up, but that the price of oil will go up even faster, increasing an already substantial gap between the two. By 2040, the report suggests that up to three percent of the transportation fuel will be in the form of compressed or liquid natural gas, mostly used by buses and long-haul freight. It's even possible that it will find a use in rail and cargo ships.

So, while the report is limited by its mandate to stick within the confines of existing regulations, the most likely results of any regulatory changes are to enhance the impact of underlying trends in efficiency and energy extraction. In other words, unless governmental policies change radically, we're likely to get to some of these places sooner than 2040.

EDIT: not sure why this is getting down-voted. If it has anything to do with my claim that methane is a more potentent greenhouse gas than CO2, go back and read the IPCC report. I think it is on page 86 where they claim that methane has a global warming potential of 82 when compared to CO2 (in the 20-year timeframe). In the 100-year timeframe, methane has a global warming potential of 34. CO2 has a global warming potential of 1 (it is the baseline).

We have CO2 emissions per dollar (not sure if adjusted for inflation) and CO2 emissions per capita. What about total CO2 emissions? We can't handle greater CO2 emissions just because GDP is growing.

Aggregate numbers aren't useful because the aggregate number is dependent upon population, economic growth, and efficiency. Aggregate doesn't tell you what you can do, nor how to target it. Emission per GDP dollar is a way of separating emissions from economic growth. It's a way to measure efficiency. That is all. It is not a target. In fact, there is no target, because there's no carbon policy.

CO2 per GDP dollar is a very useful number, and an encouraging one too. With it already falling (while GDP climbs), it suggests we could make more than modest reforms without damaging the financial welfare and security of the people.

Actually, it's exactly the same technique, and goes by the same name (which does not include a "k" when used inside the industry). The chemistry and media are sometimes different for oil, but they vary from well to well anyway.

CO2 per dollar? Sounds like we will just inflate our way out, much like other overwhelming economic burdens like social security.

If electricity goes from $0.10 a KWH to $0.20 a KWH, then the CO2 production per dollar just dropped in half. But then it's a race between the fed and the frackers. Can the fed hidden inflate with QE as fast as the frackers flood the market with cheap electricity from burning natural gas?

I assume the CO2 per inflation-adjusted $ GDP is included in these reports to dismiss the idea that we cant get cleaner and grow at the same time, which is one of the tropes thrown at clean energy.

The short-term boom in oil might just be what we need to bridge Americans to practical EVs in the late 2010s and early 2020s. Early adopters (like myself) are OK deal with the peculiarities of EVs/Plug-ins now, but for mass market adoption, you're going to need to take something like a Tesla and make it widely available (read: affordable) to the public.

Ultimately, oil's days are numbered, and the lack of supply is just a small factor - rather the cost of producing oil and the money paid out by governments of oil producing nation to their citizens (either direct payment or subsidy of oil/gas) creates a practical price floor for a barrel of oil. Certain OPEC countries are working hard to keep the price around $100/bbl, and at that price it'll be easy for EVs to come in and undercut gasoline prices. Fracked US crude is going for cheaper, and will continue to go for cheaper, but in the long run it wont stay that way.

We have CO2 emissions per dollar (not sure if adjusted for inflation) and CO2 emissions per capita. What about total CO2 emissions? We can't handle greater CO2 emissions just because GDP is growing.

Edit: Scratch that, it was total emissions specified as having peaked in 2005 and 2007. The graph below was just supplementary information.

Can't imagine why that would get a down vote.

Quote:

In addition to the growth of natural gas and rise of renewables, the report ascribes this drop to an increase in efficiency (vehicle fuel efficiency in particular is improving significantly). This won't result in a big drop in carbon emissions—continued GDP growth will offset these tends—but it could mean a prolonged plateau out to 2040.

Peaked in the sense they won't go higher, but a "prolonged plateau" isn't going to fix things. Rather the opposite. warming effects will continue to accelerate, just not as much as if we'd increased carbon emissions. As you note, the atmosphere doesn't care about per capita or per dollar of GDP.

The amount of excrement I am spreading around my home is huge but the amount of money I make from doing it is huge as well. In fact my excrement spreading per dollar of income is declining. All is well.

Well recall we also outsourced a lot of our goods productions to regions of the world that are less energy efficient than we are. So we have, in effect, outsourced our CO2 production as well. We need to pressure South/East/Southeast Asia into reducing CO2 emissions to truly bring down the costs.

Now just imagine how fast emissions could drop if we put a reasonable price on them. A $30 / ton carbon tax would add about 3¢ / kWh to coal, 1.2¢ / kWh to natural gas (combined cycle), 30¢ / gallon to gasoline, and 20¢ / therm to natural gas. You could phase out the 2.2¢ / kWh credit for wind power, and it would still be cheaper than coal. Those amounts aren't really that high, but you could return the collected tax as a flat payment to eliminate the burden on the poor.

Can the fed hidden inflate with QE as fast as the frackers flood the market with cheap electricity from burning natural gas?

It is sort of off-topic, but QE is just backfilling money supply lost due to banks lowering their leveraging percentages (EDIT: and some lost capital from the crash). So it is "hidden" in so much as it is not really happening.

Now just imagine how fast emissions could drop if we put a reasonable price on them. A $30 / ton carbon tax would add about 3¢ / kWh to coal, 1.2¢ / kWh to natural gas (combined cycle), 30¢ / gallon to gasoline, and 20¢ / therm to natural gas. You could phase out the 2.2¢ / kWh credit for wind power, and it would still be cheaper than coal. Those amounts aren't really that high, but you could return the collected tax as a flat payment to eliminate the burden on the poor.

Now just imagine how fast emissions could drop if we put a reasonable price on them. A $30 / ton carbon tax would add about 3¢ / kWh to coal, 1.2¢ / kWh to natural gas (combined cycle), 30¢ / gallon to gasoline, and 20¢ / therm to natural gas. You could phase out the 2.2¢ / kWh credit for wind power, and it would still be cheaper than coal. Those amounts aren't really that high, but you could return the collected tax as a flat payment to eliminate the burden on the poor.

...Can the fed hidden inflate with QE as fast as the frackers flood the market with cheap electricity from burning natural gas?

Have you actually looked at inflation lately? Hint: It's really low!

a wise man once said inflation is really low as long as you don't eat or travel. The core basket is very flat but if you look at food or fuel its way up.

...and then down (well gasoline fuel is, anyway). That's why there is a "basket", because commodities naturally fluctuate. If you focus on one or two given items, especially those whose effects also get reflected in the others, you get a somewhat distorted view.

Sorry to be off-topic, but why do say Social Security is an "overwhelming burden"? It's a program that is self-sufficient and has kept many millions of people out of poverty in their old age. The idea that the system is crumbling is a fallacy. Here's one of many explanations.

Now just imagine how fast emissions could drop if we put a reasonable price on them. A $30 / ton carbon tax would add about 3¢ / kWh to coal, 1.2¢ / kWh to natural gas (combined cycle), 30¢ / gallon to gasoline, and 20¢ / therm to natural gas. You could phase out the 2.2¢ / kWh credit for wind power, and it would still be cheaper than coal. Those amounts aren't really that high, but you could return the collected tax as a flat payment to eliminate the burden on the poor.

I understand the point of using the basket. I'm just pointing it out because saying inflation is flat without noting that your referring to core inflation and not talking about two of the largest segments of the household budget could be misleading.

I understand the point of using the basket. I'm just pointing it out because saying inflation is flat without noting that your referring to core inflation and not talking about two of the largest segments of the household budget could be misleading.

Note that just looking at fuel prices alone is actually a very broken way to measure inflation over the long term. This is because of increased efficiency in our use of a given unit of fuel (thus this article).

CO2 per dollar? Sounds like we will just inflate our way out, much like other overwhelming economic burdens like social security.

If electricity goes from $0.10 a KWH to $0.20 a KWH, then the CO2 production per dollar just dropped in half. But then it's a race between the fed and the frackers. Can the fed hidden inflate with QE as fast as the frackers flood the market with cheap electricity from burning natural gas?

Sorry to be off-topic, but why do say Social Security is an "overwhelming burden"? It's a program that is self-sufficient and has kept many millions of people out of poverty in their old age. The idea that the system is crumbling is a fallacy. Here's one of many explanations.

Not sure that Headline is supported by the article. He is saying that to correct it a pretty large change must be made.

Now just imagine how fast emissions could drop if we put a reasonable price on them. A $30 / ton carbon tax would add about 3¢ / kWh to coal, 1.2¢ / kWh to natural gas (combined cycle), 30¢ / gallon to gasoline, and 20¢ / therm to natural gas. You could phase out the 2.2¢ / kWh credit for wind power, and it would still be cheaper than coal. Those amounts aren't really that high, but you could return the collected tax as a flat payment to eliminate the burden on the poor.

I would advocate adding at least $0.50 per gallon to gasoline and using the proceeds to build out public transportation and a long-distance train network.

Now just imagine how fast emissions could drop if we put a reasonable price on them. A $30 / ton carbon tax would add about 3¢ / kWh to coal, 1.2¢ / kWh to natural gas (combined cycle), 30¢ / gallon to gasoline, and 20¢ / therm to natural gas. You could phase out the 2.2¢ / kWh credit for wind power, and it would still be cheaper than coal. Those amounts aren't really that high, but you could return the collected tax as a flat payment to eliminate the burden on the poor.

I would advocate adding at least $0.50 per gallon to gasoline and using the proceeds to build out public transportation and a long-distance train network.

I would advocate adding a $.50 per gallon gas tax and using the proceeds to cut taxes elsewhere, especially income tax and FICA on the poor.

Now just imagine how fast emissions could drop if we put a reasonable price on them. A $30 / ton carbon tax would add about 3¢ / kWh to coal, 1.2¢ / kWh to natural gas (combined cycle), 30¢ / gallon to gasoline, and 20¢ / therm to natural gas. You could phase out the 2.2¢ / kWh credit for wind power, and it would still be cheaper than coal. Those amounts aren't really that high, but you could return the collected tax as a flat payment to eliminate the burden on the poor.

I would advocate adding at least $0.50 per gallon to gasoline and using the proceeds to build out public transportation and a long-distance train network.

I would advocate adding a $.50 per gallon gas tax and using the proceeds to cut taxes elsewhere, especially income tax and FICA on the poor.

I've met plenty of poor, working people, but I've never met one who paid any income tax.They fill out their W-4s to eliminate withholding and then collect a EITC at tax time.

Now just imagine how fast emissions could drop if we put a reasonable price on them. A $30 / ton carbon tax would add about 3¢ / kWh to coal, 1.2¢ / kWh to natural gas (combined cycle), 30¢ / gallon to gasoline, and 20¢ / therm to natural gas. You could phase out the 2.2¢ / kWh credit for wind power, and it would still be cheaper than coal. Those amounts aren't really that high, but you could return the collected tax as a flat payment to eliminate the burden on the poor.

I would advocate adding at least $0.50 per gallon to gasoline and using the proceeds to build out public transportation and a long-distance train network.

I've met plenty of poor, working people, but I've never met one who paid any income tax.They fill out their W-4s to eliminate withholding and then collect a EITC at tax time.

I don't know if this was the intent of the post you are quoting, but a gas tax would tend to be regressive (like consumption taxes generally), so you would want to decrease other taxes on the poor to at least keep the tax burden the same. If they already pay net negative federal taxes you would increase EITC as one possibility to keep the burden the same.

Now just imagine how fast emissions could drop if we put a reasonable price on them. A $30 / ton carbon tax would add about 3¢ / kWh to coal, 1.2¢ / kWh to natural gas (combined cycle), 30¢ / gallon to gasoline, and 20¢ / therm to natural gas. You could phase out the 2.2¢ / kWh credit for wind power, and it would still be cheaper than coal. Those amounts aren't really that high, but you could return the collected tax as a flat payment to eliminate the burden on the poor.

I would advocate adding at least $0.50 per gallon to gasoline and using the proceeds to build out public transportation and a long-distance train network.

I would advocate adding a $.50 per gallon gas tax and using the proceeds to cut taxes elsewhere, especially income tax and FICA on the poor.

I advocate no new taxes, and instead cut wasteful spending, pork projects and reform government contracting. Then once we have done that we can see how much money we have, allocate it properly and then decide if we need a new tax or not.

I've met plenty of poor, working people, but I've never met one who paid any income tax.They fill out their W-4s to eliminate withholding and then collect a EITC at tax time.

I don't know if this was the intent of the post you are quoting, but a gas tax would tend to be regressive (like consumption taxes generally), so you would want to decrease other taxes on the poor to at least keep the tax burden the same. If they already pay net negative federal taxes you would increase EITC as one possibility to keep the burden the same.

Now just imagine how fast emissions could drop if we put a reasonable price on them. A $30 / ton carbon tax would add about 3¢ / kWh to coal, 1.2¢ / kWh to natural gas (combined cycle), 30¢ / gallon to gasoline, and 20¢ / therm to natural gas. You could phase out the 2.2¢ / kWh credit for wind power, and it would still be cheaper than coal. Those amounts aren't really that high, but you could return the collected tax as a flat payment to eliminate the burden on the poor.

I would advocate adding at least $0.50 per gallon to gasoline and using the proceeds to build out public transportation and a long-distance train network.

I would advocate adding a $.50 per gallon gas tax and using the proceeds to cut taxes elsewhere, especially income tax and FICA on the poor.

I advocate no new taxes, and instead cut wasteful spending, pork projects and reform government contracting. Then once we have done that we can see how much money we have, allocate it properly and then decide if we need a new tax or not.

The point of a tax on fuel isn't just to raise more money to spend. It also changes behavior in a way which leads to less pollution, less dependence on oil imported from unfriendly foreign countries, and an overall more sustainable energy economy. Then you take the proceeds of the tax and invest it in furthering those same goals through infrastructure improvement, and you end up with real progress towards these goals.

Keep in mind the EIA or Energy Industry Association - a euphemism for Big Oil is charged by the Obama Whitehouse with the task of spewing Big Oil propaganda

"The other thing driving the drop in carbon intensity is the natural gas boom. "

As Jonnale pointed out earlier this is Big Oil junk science proving the EIA's place on Big Oil's propaganda chain. Real science peer reviewed and published in reputable journal has gas as a worse GHG producer than coal when the copious methane leaks from production to delivery are added in. An inconvenient truth for Big Oil, Obama it seems has forbidden the EPA from including methane in its GHG statistics.

From Harvard Google "study-methane-emissions-natural-gas-production"

"made natural gas the cheapest way to generate electricity in the US (second only to well-sited wind), "

Actually the cheapest form of new electricity in the US is nuclear at half the cost of gas. Instead of Big Oil paid propaganda from the EIA, we have real numbers, sworn under oath and under penalty of perjury for a real first of a kind nuke build by an extremely inefficient American private utility now under way in S Carolina at twice the cost of similar units in China

"Why Nuclear?” If you look at the chart at the top right of the slide below, SCANA provided their all-in cost estimates for nuclear ($76/MWh), natural gas ($81/MWh), coal ($117/MWh), offshore wind ($292/MWh) and solar ($437/MWh). For them, “new nuclear continues to be the low cost alternativ"

Goggle "SCANA2011AnalystDayPresentation.pdf"

Built by an efficient public utility like TVA or OPG with its much lower cost of money that $76 drops to $40 4 cents a kwh.

Note that gas at $3.5 mcf is currently priced at half it's cost of production, According to Forbes it is rapidly heading towards $8/mcf - Google "8-natural-gas-were-right-on-schedule".

"the report predicts will see gas become the largest source of electrical power in the US by 2030"

Its hard to argue against corruption I suppose. Not a single gas power plant would be built if owners had to guarantee the input price of fuel for 60 years like nukes in effect do. These sharks just build the dirt cheap gas plant and pass the gas price costs on to the rate paying sucker while tacking on a 15% gratuity needed to satisfy the graft.

The problem Big Oil's promoters are seeing is China, immune from Big Oil corruption that currently owns the Western political system, ain't buying in to the EIA bull and is building nukes as fast as it can adding nuke factory module production and seeing costs drop towards the 1 cent a kwh area. The 2017 Chinese HTGR is ideally suited for hydrogen production and will use 70% of its output on net zero carbon synfuel production. By 2030 Soon the Chinese will be shipping them out on containers, the entire country GHG free, having completed their fossil to nuclear conversion and running on penny a kwh nukes. Maybe voters in the soon to be bankrupt west too will get away from their Big Screen's watching 8 hours a day of Survivor and Sports reruns long enough to catch on to how their politicians sold them out.

"(second only to well-sited wind),"

Editor please, we are talking costs here not sale prices after subsidy. The actual cost of wind is over 47 cents a kwh in Ontario when the feed in tariff cost of 14 cents a kwh ( same as the actual cost of the Shepherd's flat giant Oregon wind farm) is supplemented with gas backup fees, 5 times sized transmission builds and surplus dumping costs. The cost of Ontario's nuclear is 3 to 4 cents a kwh.

"It's made natural gas the cheapest way to generate electricity in the US (second only to well-sited wind)"

I've never heard that before. I couldn't find it in the docs. Can someone point it out?

If well-sited wind is the absolute cheapest electricity in the US, that's a huge, huge deal, at least for electricity users in the Great Plains. Add in a good chunk of transmission cost to get it anywhere else.

The other thing driving the drop in carbon intensity is the natural gas boom. It's made natural gas the cheapest way to generate electricity in the US (second only to well-sited wind),

I found the part about the cheapness of wind power interesting so I went to the report...

-- Compared to the AEO2013 Reference case, renewable generation is higher throughout most of-- the projection period, particularly in the near term, because of the inclusion of the energy -- provisions of the ATRA. This law, among other things, extends several tax credits for utility-scale-- renewables and redefines the qualification criteria, resulting in more construction of wind-powered-- generating capacity in the near term.

Unless I'm reading this wrong, this refers to the price of subsidized wind. A previous article (or perhaps the comments) dealt with the fact that wind operators would sell power even when the price was negative because they still made a profit on the subsidies.

So what is the real price of wind power? Given that discussion on the externialities of coal is de rigueur, why is it not equally important to look at the true price of other power options?

The point of a tax on fuel isn't just to raise more money to spend. It also changes behavior...

Is that actually true? I thought that fuel had a pretty inelastic demand curve...

In the short run, yes. But if you're looking at a policy that's going to be in effect for years, then people and businesses can adjust by adopting an assortment of efficiency improvements and moving to energy sources with lower carbon emissions.

Not every person or industry will be able to transition to alternatives equally well, which is part of why cap-and-trade is tossed around as a more politically feasible alternative to a flat carbon tax.